Teva Pharmaceutical Industries Ltd. (Nasdaq: TEVA; TASE: TEVA) will lead an $8.5 million round for Multi Gene Vascular Systems Ltd. (MGVS) alongside the company's current investors, Tamir Fishman Venture Capital (TASE: TFVC), Ofer Hi Tech Ltd., Aviv Venture Capital, and private investors including Eitan Wertheimer. The company value for the round is $20 million before money.
Teva will invest $4 million, and the other investors will put up $4.5 million, including $2.5 million of previous convertible loans. MGVS has raised $14 million to date.
Teva also received an option to make additional investments in MGVS, subject to the company obtaining marketing certification for its products, Multi Gene Angio, a cell therapy for treating ischemia in patients with peripheral arterial disease and coronary artery disease; and Multi Gene Graft, a biosynthetic vascular graft.
MGVS will use the proceeds to finance the Phase I/IIa safety and efficiency clinical trial of the Multi Gene Graft. When the trial is completed, in about 18 months, and assuming it is successful, Teva has an option to make an additional investment in the company to finance the subsequent clinical trials. This investment could amount to tens of millions of dollars, in exchange for which Teva will be allotted more shares in the company at substantially higher company values.
If and when the Multi Gene Graft obtains marketing approval in the EU or US, Teva will receive marketing rights to the product and can buy out MGVS's other shareholders using milestone payments or royalties. Teva can forego the options at any time until marketing approval is obtained, in which case MGVS's shareholders can buy back Teva's stake.
Published by Globes [online], Israel business news - www.globes-online.com - on October 27, 2009
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